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Minutes 07-23-90MINUTES OF THE CITY COMMISSION BUDGET WORKSHOP HELD IN COMMISSION CHAMBERS, CITY HALL, BOYNTON BEACH, FLORIDA, MONDAY, JULY 23, 1990 AT 6:25 P.M. PRESENT Gene Moore, Mayor Lee Wische, Vice Mayor Lillian Artis, Commissioner Robert Olenik, Commissioner Arline Weiner, Commissioner J. Scott Miller, City Manager Carrie Parker, Asst. City Manager Grady Swann, Finance Director Diane Reese, Asst. Pinance Director Sharon Randolph, Assistant to the City Manager Mayor Moore called the Budget Workshop to order at 6:25 P.M. City Manager Miller announced they would start with General Fund revenues, providing a brief on expenditures, starting from the Mayor and Commission and proceed forward. He outlined material he wished to cover at each of the three budget meetings. Discussion about Tradewinds Monies Before they proceeded, Mayor Moore stated he would stre- nuously continue to argue that the money received from the Tradewinds settlement ($800,000) be applied back into the Tradewinds payment on the bond debt service. He thought that would take us through 1991 and would free up those pledges, taking away the Franchise Tax Income from the General Fund. The Mayor felt those monies emanated from the Tradewinds matter and should be kept in a sinking fund strictly for paying the debt service that comes due on the bonds and not be used for other purposes. By doing this, the Mayor felt they could basically start out with the budget balanced. They wouldn't tap the revenue income from the Franchise Tax and could put that toward paying the bonds. The City Manager thought the Mayor was correct in this regard. Vice Mayor Wische asked if thought had been given on how to replenish the General Fund which has a zero balance. The Mayor remarked we might have to raise the millage in the final analysis. Discussion ensued. City Manager Miller stated they needed to remember that at the end of this fiscal year the projected deficit is about $800,000. That means next year you have no prior year fund balance. Mr. Miller stated you could technically hold the $706,000 in a fund and that fund would be applied to the General Fund. The total ledger at the end of this year would end with a positive figure. 1 MINUTES - CITY COMMISSION BUDGET WORKSHOP BOYNTON BEACH, FLORIDA JULY 23, 1990 Commissioner Weiner suggested they proceed and see how much money they could knock off the City Manager's budget and then they could begin a discussion on what to do with this money. Vice Mayor Wische complimented the City Manager and his staff on the proposed budget as he hadn't been able to find any "fat" in it yet. Mayor Moore remarked you don't "throw it in right now." Mr. Miller noted you don't have to. The Mayor stated it could be put in a fund and held to pay the bond payments as they come due. You don't have to tap the Franchise Tax. Mr. Miller thought as long as you have a revenue source, it didn't matter. Commissioner Olenik observed you don't even have to pay for them out of the Franchise Tax. We are just pledging the future revenues of the Franchise Tax. Mr. Miller remarked that was correct. The question was raised as to whether that would flow into the General Fund. Mr. Miller stated it never comes into the General Fund. Grady Swann interjected this is being designated out of the General Fund to pay debt service for Tradewinds. Carrie Parker noted they had reduced it before it gets to the General Fund Revenue. Mr. Miller explained as they proceeded, they would see on the revenue side, that Utility taxes totally, have been reduced approximately 27%. That means of 100% of the reve- nues, 27% was going to pay off the debt service on the 1985 and 1990 issue. That money was not going into the General Fund because it had been pledged. Only 73% is coming in on the revenue side. Mr. Miller stated if you leave the $800,000 where it is now, the bottom line on the fund balance at the end of the year would "wash out." You can let it sit there. Mayor Moore asked if the City was pledging money from the gross income of the Franchise Tax to pay the Tradewinds bonds, rather than going into the General Fund. Mr. Miller responded affirmatively. In the Mayor's opinion, the Tradewinds money sitting in a trust fund was not going in as general revenue into the General Fund. Mr. Miller stated that was correct. The Mayor thought that was a shortfall which would be eliminated by using the Tradewinds money to pay the bonds. Mr. Miller responded that could be done. That would free up the utility tax for the first year only. Discussion took place regarding the dates of upcoming interest and principal payments. Commissioner Olenik thought the Commissioners basically agreed with the Mayor. Review of General Fund Revenues City Manager Miller explained that as they proceeded, if the Commission decided they wished to save in dollars, they would get involved in affecting municipal service levels and/or activities and programs. 2 MINUTES - CITY COMMISSION BUDGET WORKSHOP BOYNTON BEACH, FLORIDA JULY 23, 1990 The proposed FY 1990-91 General Fund (operating budget) pro- poses a millage rate increase of 1.0 mills which equates to $1,765,081 (~et). This is at a 96.5 collection rate. Nothing is collected at 100%. Implementation of several new fees are proposed including pre-occupancy inspection fees, fire inspection fees and interim service fees. Increase of several existing fees is also proposed. Mr. Miller remarked the City had been losing money in this area and they are proposing to cover the City's costs. These changes would be based on recommen- dations in a cost analysis study performed by David Griffith & Associates in 1988 as well as the City's own studies. An increase in the Water/Sewer Rate Structure fees was pro- posed due to the increased costs of system operation and maintenance and debt service requirements for the proposed Water/Sewer R~-venue Bond issue of 1990 which includes the $35,000,000 on the West Water Treatment Plant construction as well as the odor abatement program and enhancement to the Sewer Treatment Plant. A decrease in the residential and commercial rate structure charges was proposed due to the substantial reduction in disposal costs on the City's part because the Solid Waste Authority will be placing disposal costs on the property tax bills. Discussion took place about the reasons for the Sanitation Fund having a $300,000 deficit. Increased costs effective October 1, 1989 were not passed on to residents until the beginning of 1990. Remarks were made about the building economy. The City Manager stated if building dries up in this City, then Inspectors, Plan Reviewers and some other City employees might not have work. The City could find itself in a posi- tion where employees would have to be laid off. Hopefully, that will not occur. On the expenditures side, Mr. M~ller pointed out personnel services total $23,112,980 which is 80% of the general operating cost. He felt this was high. The highest percen- tage M~. Miller had ever seen previously was close to 75%. He thought salary and benefits accounted for this. ~%e chart on page 3 of the proposed budget was examined. The City Manager pointed out where increases took place in General Fund revenues such as those related to FPL and cable fees. Mr. Miller pointed out on page 4 the 90/91 estimated revenue column. The column marked "City Manager Recommended" represented 73% of the previous column. The reason for this is the 1985/1990 issue. Tradewinds is a factor here. It was pointed out these are public service MINUTES - CITY COMMISSION BUDGET WORKSHOP BOYNTON BEACH, FLORIDA JULY 23, 1990 utility taxes where this revenue is not coming in through the General Operating Fund. 27% of it is taken and put off to the side for debt retirement prior to going into the General Fund. On page 4, line 141.10 in the 89/90 current budget column, Mr. Miller pointed out the anticipated revenue coming in was $1,950,000. He remarked on what was collected in 87/88 and 88/89. He noted the 89/90 figure was quite a jump. He referred to the 89/90 anticipated figure of $1,720,000 and pointed out we would not collect $200,000 of that revenue. This was an area that was over-estimated as a revenue last year. The 90/91 estimated revenue figure of $1,880,000 had been estimated based on a 5 - 7% growth factor, going back five years. On page 5, it was noted there will be an increase in the charge for occupational licenses. A proposal on the occupa- tional licenses will be ready for the City Commission on August 7, 1990. Discussion took place regarding some uses in the City where occupational licenses do not have a cate- gory, such as bars. The City has licenses for adult enter- tainment establishments and restaurants. There are several bars in the City, however, that do not have a classifica- tion. The Mayor thought an "Other" category should be included. Don Jaeger, Building Official interjected they ~ry to get them under the category of restaurant as most of these bars sell food. However, revenue could be increased by also charging a license tax for the alcohol sales. Mr. Jaeger noted this was what they were currently examining. Staff was proposing to add a number of categories. It is being proposed that a fee of between charged for pre-occupational inspections. explained how this would work. $35 and $50 be Mr. Miller Mayor Moore referred to the 1.1 increase and asked if any type of emergency or surplus fund had been provided for. The City Manager responded this was "bare bones." Mr. M~ller agreed there should be some contingency in there. Rather than keep millions of dollars of funds, Commissioner Olenik made remarks about possibly looking into a line of credit which could assist in a major emergency situation. Mr. Miller stated if there was a major emergency, the City would be forced to borrow from the Utility Fund and then pay it back. i Mr. Miller addressed page 5 and increases in building permit fees which would enable the Building Dept., Code Enforcement and the Plans Review Division to pay for themselves. Building permit fees have not been amended since 1984. 4 MINUTES - CITY COMMISSION BUDGET WORKSHOP BOYNTON BEACH, FLORIDA JULY 23, 1990 On page 5, line 292.10, Beach Decals was addressed. Mr. Miller pointed out the City currently collects about $998,000 for beach decals. Commissioner Weiner pointed out we currently charge $7/year for a beach decal. She suggested this be increased to $15/year. Vice Mayor Wische stated he would have to vote against this. Commissioner Weiner then suggested an increase to $10/year. She referred to biting the bullet and trying to get the millage down. Comments were made by Charles Frederick, Director of Recreation & Parks. Discussion took place. The consensus was to hold this in abeyance for the time being. Commissioner Weiner had asked the City Manager to look into the option of charging for parking at Boat Ramp Park. Remarks were made by Charles Frederick about State hearings taking place in August and the City possibly being able to establish separate fees for residents/non-residents early next year. Mr. Frederick referred to a survey performed in 1987 and stated at that time 60% of the use was by non- residents. At that time, people using the park indicated they would be willing to pay a parking fee. If the City ~anted to charge a fee right away, a DOT regulation would require that residents and non-residents be charged the same. Commissioner Olenik preferred to not budget for this charge now and noted it could prove to be "gravy" as a reve- nue source down the road. Commissioner Olenik referred to page 5, line 293.50, Landlord Licenses. He thought if it is costing the City $12,000 to collect $11,000, it might not be a worthwhile fee. He asked for a report on how much time is spent trying to collect this money. The Commission agreed we need to look into whether this is a "losing deal." Relative to the Cigarette Tax, State Revenue Sharing and the Sales Tax, (page 6, lines 351.10, 351.20 and 351.80), Mr. Miller pointed out these are decreased from last year's current budget. The State tells the City what the appropriation is to be on these. The City figures in about 95% on these. Rarely do you get more than what the State tells you you will receive. Discussion took. place on these items. School Crossing Guards, page 6, line 382.10 had been decreased because of funding. In fiscal year 91/92, funding is cut out entirely and the City will have to absorb it entirely. Discussion took place on volunteers assisting in this area and insurance liability. Relative to page 7, line 413.90, Street Lighting Fees, Vice Mayor Wische referred to thousands of dollars shown and he pointed out if it's not costing us this amount to install 5 MINUTES - CITY COMMISSION BUDGET WORKSHOP BOYNTON BEACH, FLORIDA JULY 23, 1990 the lights, shouldn't this be kept in some sort of fund con- tinuously? It was noted this does not go through with FPL's Franchise Tax. This is the City's charge in subdivisions. The City needs to get up-front money to get the work done. The City Manager stated he would check this out for the Commission. Mr. Miller addressed Fire Inspection Fees which are currently done free. He felt the City should be charging for this and the proposed procedure was explained. Commissioner Olenik noted a 5,000 sq. ft. church would be charged $50 for this and yet a restaurant (over 199 persons) would be charged $38. He questioned if this was equitable. Mayor Moore asked why the church should be charged at all. Mr. Miller stated the problem you have is that a service is being provided. Residents who are paying taxes are not receiving anything on a fire inspection. You have to look more towards the user. The City Manager asked when you start making exemptions, where do you stop? Commissioner Olenik didn't have a problem with no exemptions, but he did think churches should be charged on a more nominal basis. Mr. Miller stated they could re-review that as a good point had been made. Discussion took place regarding page 7, line 422.00 Fire Services and line 424.10 EMS Services. It was noted that the Village of Golf will be coming "on line" October 1, 1990 and would be charged $65,000 for fire service. Mr. Miller pointed out there should be a line item underneath 422.00, for Fire Inspection Fees. Mr. Miller stated he thought Fire Inspection Fees would be about $50,000 to $60,000, but he would check on the dollar amount and provide it for the Commission at the subsequent budget workshop. The new item, Interim Services Fee on page 9, line 499.90 was explained. Every residential home, business or apart- ment complex would pay this fee which would be an interim payment in lieu of taxes for receiving of Police, Fire, EMS, Public Works, Streets and Recreation & Parks services. Some departments are backed out of this. The City Manager was proposing an economists' study be undertaken in this regard. Mr. Miller stated he proposed to advance this from the uti- lities so they would know those dollars would be in the General Fund and then pay it back over an annual basis. Mayor Moore asked if this had been tested in the Courts. Mr. Miller responded it had been and he explained the experience of Oakland Park and Tamarac. Remarks were made about possibly copying the Ordinance of one of these other cities. Mr. Miller pointed out we need to perform the eco- nomists' study because you don't want to just take somebody else's study and retro-fit it into your own situation. Boynton Beach's budget is different than Oakland Park's. MINUTES - CITY COMMISSION BUDGET WORKSHOP BOYNTON BEACH, FLORIDA JULY 23, 1990 The Court had provided Mr. Miller with these facts in 1985. Technical explanation was provided by the City Manager on this subject. It was pointed out that this fee is collected at the time the CO is issued. The City Manager proposed collecting this fee beginning January 1, 1991 and the Ordinance would have to be in place prior to that. The Mayor didn't think the CO was the critical test but rather whether the building was substantially complete on January 1, 1991 or not. He remarked on developers passing costs on. Mr. Miller responded you would prorate the interim service fee. Page 9, line 540.30, False Alarms Fines was discussed at length. An Ordinance had been drafted on this topic. Programming was the other aspect of it. Mr. Miller stated there are many false alarms and the City should be billing for them. Discussion took place regarding repeat offenders and the probability of collecting when back billing is involved. The City Manager pointed out they would see a decrease in the interest income (page 9, line 611.50) primarily due to the amount of funds. We no longer have the prior year fund balance of $1,000,000 sitting in the bank earning interest. We will see a decrease there. Also the interest rates are not going to be jumping in the next 6 months to a year. This is another major deficit area. Attorneys' fees also took a lot of money. Carrie Parker referred to page 11, line 821.10, Water & S!ewer Revenue Fund Adm., and explained we show $1,350,000 in this budget and when you get to the Water and Sewer line, last year they only budgeted $1,000,000. Last year there w~as a differential between what the General Fund collected a!nd what the Utilities billed. It was really an increase in the Utilities budget, but it was left the same. It was noted the City went ahead and took the $1,300,000. Discussion ensued about administrative time City employees spend in this regard in Finance, Data Processing, Customer S~ervice and Purchasing. ~s the revenue side of the picture had been completed, a rlecess was declared at 8:15 P.M. The meeting resumed at 8':25 P.M. G~eneral Operating Fund - Expenditure Side Ciity Commission - Page 15 Relative to City business related meal rates, Mr. Miller stated updated rates were in the works and would be ready 7 MINUTES - CITY COMMISSION BUDGET WORKSHOP BOYNTON BEACH, FLORIDA JULY 23, 1990 for Commission review at the August 7, 1990 meeting. Commissioner Weiner suggested $5 for breakfast, $10 for lunch and $20 for dinner. Mr. Miller responded that was in line with what was to be proposed. The $12,000 allowed for business meetings (line 470.05) did not take into con- sideration that in the next fiscal year, the Florida League of Cities would meet twice in the same fiscal year, once in October, 1990 and then again in September, 1991. It was agreed that figure would have to be increased. City Manager's Budget - Page 16 Mr. Miller did an overview of this budget and explained the Assistant City Manager position (shown on page 21) is noted as "NC" (no classification). This position is no longer covered under Civil Service. Ms. Parker was approved at a salary with a pension program. Mr. Miller stated that would not necessarily include other future Assistant City Managers. Anybody in the classified service has to be a member of the City Pension Plan. Mayor Moore asked if Mr. Miller's department was entitled to the automatic COLA (Cost of Living Adjustment) other employees receive. Mr. Miller responded those that are eli- gible are. He believed he and Ms. Parker would not be included. Ms. Randolph is on "longevity." The Mayor could see no reason for discriminating against Mr. Miller and Ms. Parker in this regard and thought they should get the COLA everyone else gets, subject to being able to find the money. Mr. Miller remarked he would hope Ms. Parker would be treated as the other employees are in connection with the 0 5% increase. He stated her anniversary date is in April. Mr. Miller was not looking towards opening up his contract right now but was satisfied with his present arrangement. Other remarks were made in this regard. Mr. Miller explained how performance merit increases work. Discussion took place regarding the fact that these raises are either zero or 5%, with no middle ground. Mr. Miller noted this area was currently being addressed. ME. Miller referred to a two year contract the City has with three bargaining units, namely the Firefighters, the Police Sergeants and the Police Officers. This year is the first year for this. The contract calls for a 3% COLA on October 1, 1990 and a 3% on April 1, 1991. This is on top of the merit. The City is not close to an agreement with the International Brotherhood of Firemen & Oilers. Mr. Miller stated there were dollars in the General Operating Fund to handle two 3% increases for the general employees as well. 8 MINUTES - CITY COMMISSION BUDGET WORKSHOP BOYNTON BEACH, FLORIDA JULY 23, 1990 Relative to line 143.00, Christmas bonuses, it was noted that these bonuses are out for everybody. Discussion took place regarding travel allowances and the bottom line expense of $6,970 per month. The City Manager pointed out this does include a lot of the Inspectors in the Building Dept. who utilize their own personal vehicles. Mr. Miller indicated he would provide a list of all employees that receive the travel allowance. The City Manager indi- cated they were looking into the concept of providing pool cars in the City fleet that could be utilized by employees so they would not have to use their own cars. Mr. Miller made remarks about an employee using his/her own car on City business and having to cover insurance limits of $300,000/$100,000 which is higher than basic coverage. Discussion took place about the paperwork involved in tracking mileage. Other remarks were made about vehicle service costs and the City's garage. The City Manager remarked his department had cut back on attendance at conferences. They will be attending State conferences, but for the ICMA national conference, Mr. Miller will attend one year and Ms. Parker will attend the next year. Commissioner Weiner thought it would be a good idea for the Commission to implement a similar practice in relation to their conferences. City Clerk - Page 25 Mr. Miller stated this department would remain with eight employees. They were proposing that one CBE student be made a full-time position as the mail function will remain with the City Clerk's office. Commissioner Olenik questioned the amount anticipated in line 470.13, Legal Ads - P & Z. Sue Kruse, City Clerk pointed out the department had spent $13,000 in the month of June on Land Development Regulation ads. Finance Dept. - Page 40 It is being proposed that this department remain at 11 posi- tions. With reference to line 466.00, CPA Audit, it was estimated this would increase slightly from $22,900 to about $25,000. That proposal was not solidified yet. Citizens Services - Page 46 Mr. Miller reported this Division now falls under the direc- tion of the Finance Director. A decrease in two employees is proposed, namely one Citizens Service Clerk and a CBE Student. Provision had been made on page 47, under the 499.00 account for $3,000 for part-time work during the busy MINUTES - CITY COMMISSION BUDGET WORKSHOP BOYNTON BEACH, FLORIDA JULY 23, 1990 season. Commissioner Olenik asked questions about the possibility of going to a by-mail renewal system on the Beach Decals. Mr. Miller thought the problem that would occur would be the validity aspect of it. Remarks were made about the possibility of using a RSVP person to provide assistance to people standing in line. Grady Swann, Finance Director pointed out this year the Beach Decals and Golf Course Permits would not be handled at the same time. In the past, those two projects hit at the same time. ADJOURNMENT The City Manager remarked he would like to get through the remaining General Fund at the next night's Budget Workshop meeting. The meeting properly adjourned at 9:00 P.M. CIT~~~ON BEACH ATTEST: Clerk Recordin.g Secretary (Three Tapes) ~~ioner Commissioner 10